Airgain — Third Quarter 2026 Earnings Summary

Financial Performance:

• Q3 2026 sales were $15.3 million, representing a 12% sequential increase and a 9% year-over-year increase compared to $14.0 million in Q3 2025.
• Enterprise sales reached $10.0 million (up $3.3 million sequentially), consumer sales were $4.4 million (down $1.4 million sequentially), and automotive sales were $0.9 million (down $0.3 million sequentially).
• GAAP gross margin was 41.8%, down from 42.3% in Q2 2026 and 43.6% in Q3 2025, primarily due to a shift toward lower-margin enterprise IoT products and reduced higher-margin consumer sales.
• Non-GAAP gross margin was 42.4%, compared to 43.6% in Q2 2026 and 44.4% in Q3 2025.
• GAAP operating expenses were $6.9 million, down from $7.5 million in Q2 2026 and $7.1 million in Q3 2025, driven by the absence of severance expenses and lower amortization.
• Non-GAAP operating expenses were $6.0 million, compared to $5.7 million in Q2 2026 and $6.1 million in Q3 2025.
• GAAP net loss was $0.6 million ($0.04 per share), improving from a $1.7 million loss ($0.13 per share) in Q2 2026 and a $1.0 million loss ($0.08 per share) in Q3 2025.
• Non-GAAP net income was $0.5 million ($0.04 per share), compared to $0.3 million ($0.02 per share) in Q2 2026 and $0.1 million ($0.01 per share) in Q3 2025.
• Adjusted EBITDA was $0.6 million, up from $0.4 million in Q2 2026 and $0.3 million in Q3 2025.
• Cash and cash equivalents stood at $7.71 million as of September 30, 2026, compared to $7.36 million at December 31, 2025.
• Inventories increased to $4.94 million at September 30, 2026, from $3.58 million at December 31, 2025.

Guidance and Future Outlook:

• Q4 2026 sales are expected to range between $15.5 million and $17.5 million, with a midpoint of $16.5 million.
• Q4 2026 GAAP gross margin is projected between 39.2% and 42.2%.
• Q4 2026 Non-GAAP gross margin is projected between 40.0% and 43.0%.
• Q4 2026 GAAP operating expenses are expected to be approximately $7.0 million.
• Q4 2026 Non-GAAP operating expenses are expected to be approximately $6.2 million.
• Q4 2026 GAAP net loss per share is expected to be $(0.02) at the midpoint.
• Q4 2026 Non-GAAP net income per share is expected to be $0.05 at the midpoint.
• Q4 2026 Adjusted EBITDA is expected to be $0.8 million at the midpoint.

Business Segments and Product Lines:

• Enterprise IoT business continues to show momentum, driving higher IoT modem shipments.
• Introduced Airgain RF Intelligence, an AI-powered platform designed to accelerate antenna design and unlock new market opportunities.
• Secured two IoT design wins for AI data center infrastructure, expanding the use of NimbeLink® embedded cellular modems in electrical energy monitoring and intelligent rack-level power management, with initial revenue expected in 2027.
• Demonstrated the Lighthouse™ 5G Intelligent Node in a Southern California residential community, achieving approximately 140 Mbps in areas previously without usable cellular service.
• Expanded AirgainConnect® engagement in public safety and critical field operations, including participation in the 2026 Vision FirstNet Users Summit.

Market and Competitive Landscape:

• Demand is growing across established industrial applications and new opportunities in AI data center infrastructure.
• Near-term supply constraints continue to affect portions of the business, specifically regarding memory semiconductors which suppliers may redirect toward higher-margin AI applications.
• The market for products is developing, with operating results potentially fluctuating significantly due to seasonal factors.
• The company faces intense competition from existing and new companies that may harm sales, growth rates, and market share.

Risks and Challenges:

• Supply chain risks include component shortages, logistics delays, and potential impacts from tariffs and trade policies.
• Reliance on a limited number of contract manufacturers and channel partners poses risks if relationships fail or performance is inadequate.
• Emerging satellite-to-device connectivity technologies may reduce demand for terrestrial wireless solutions or require significant engineering investment.
• The company sells to price-conscious customers, with a few customers representing a significant portion of sales; loss of these customers could significantly decrease sales.
• Intellectual property protection risks could harm competitive position or incur significant enforcement expenses.

Management Commentary and Tone:

• President and CEO Jacob Suen described the quarter as "strong" with continued momentum in enterprise IoT.
• Management expressed focus on sustaining enterprise IoT momentum, converting growth platform opportunities into revenue, and driving profitability improvements.
• The tone acknowledges near-term supply constraints but remains focused on long-term growth and portfolio expansion.

Other Key Points:

• Stephan Memmen, a wireless industry veteran with over three decades of experience, was appointed to the Board of Directors.
• The company reported a gain on business acquisition of $340,000 during the nine months ended September 30, 2026.
• Net cash provided by financing activities for the nine months ended September 30, 2026, was $3.239 million, primarily from proceeds from at-the-market common stock offerings and employee stock purchase/option exercises.
• Net cash used in operating activities for the nine months ended September 30, 2026, was $2.698 million.
• Stock-based compensation expense for the nine months ended September 30, 2026, was $2.314 million.